EU Digital Finance Platform

Interview with Christine Mai, Digital Finance Unit, European Commission

Earlier this year, the European Commission launched the EU Digital Finance Platform, a collaborative space bringing together industry and public authorities to support innovation in the EU’s financial system. Can you talk more about the initiative and from where this idea came?

The EU Digital Finance Platform is a key initiative announced in our Digital Finance Strategy of September 2020. On the one hand, this new website builds on the Commission’s outreach to the fintech community which highlighted the challenges facing innovative financial firms seeking to scale up their offerings across Europe. On the other hand, the Platform is a project that we continue to work on in close cooperation with supervisors and notably the European Supervisory Authorities. The objective is to build dialogue and offer practical support to innovative financial firms. In this way, we hope to help overcome the fragmentation we still see in the market for digital financial services and foster innovation for the benefit of citizens and businesses.

This platform provides different features. One of them is Digital Finance Observatory, acting as a single point of contact and knowledge for everyone interested in innovation and new technologies in the financial ecosystem. What are the available options, and what can a fintech do with them?

The Digital Finance Observatory is designed to stimulate interaction. Registered users can share content here and promote events, hackathons and research linked to digital finance. And fintechs can literally put themselves on the map: our European fintech map, which we hope will become a space that showcases Europe’s vibrant fintech ecosystem and lead to new discoveries and connections. At the moment, the map features only two Italian firms – so I would encourage your members to add their firms. It only takes a couple of minutes! We also have a Policy corner in this part of the Platform where we collect information on political and legislative initiatives at the European level, regulatory news and funding opportunities.

By browsing into the Platform website is possible to see, right next to the Observatory, a part indicated as ‘European Forum for Innovation Facilitators Gateway’. Can you tell us a bit more about it?

The Gateway is a single access point built to offer practical support to financial firms. For the first time ever, the information needed to contact national supervisors, as well as links to their innovation hubs, regulatory sandboxes and national licensing requirements can be found in one place. This section of the EU Digital Finance Platform also hosts information about the work of the European Forum for Innovation Facilitators. The Forum that brings together representatives of national supervisors in charge of innovation, coordinated by the European Supervisory Authorities. The objective is to foster exchange and mutual learning among the authorities involved, encouraging supervisory cooperation and convergence – another important factor in overcoming fragmentation. 

In the spirit of the European Forum for Innovation Facilitators and the collaboration among National Authorities, one of the platform’s pillars is “Cross-border testing”. Companies seeking to involve multiple authorities in a testing process can apply through the EU Digital Finance Platform via an online form. Could you please explain how this option would work?

Cross-border testing is a new initiative, driven by the European Forum for Innovation Facilitators and hosted on the EU Digital Finance Platform. The idea is to make life easier for financial firms that want to offer their products and applications across national borders. They can fill in a form and upload it on the Platform to launch a request for cross-border testing, contacting multiple national supervisors in one step. These supervisors can play different roles: regulatory sandbox, observer and recipient of test findings, with the opportunity to work together on specific cases. The testing itself will still take place at the national level, according to national laws, and any decisions on the award of a licence will be taken by the respective national authority, but we think this is a big step forward.

What are the next steps for this platform? Do you have any aspects you are particularly working on, and that will be released in the future? 

We are currently working to prepare the second phase of the Platform. The main novelty we want to add will be a Data hub. This will be a space where we intend to make non-personal, non-public data available to financial firms so that they can use it to test innovative solutions in close contact with supervisors. Our objective is to complement national innovation hubs and sandboxes as well as cross-border testing and create a new tool to support data-driven innovation. A lot of fine-tuning will still be necessary before we launch the Data hub – in the second half of 2023 according to current planning – and I hope that Italian fintechs and their feedback will play an active role in helping us build an attractive and useful offering here.